Zenith Bank doubles dividend to N10 as profit growth slows

Zenith Bank Plc more than doubled its total dividend payout to N10 per share for 2025, signalling confidence in cash generation despite slowing profit growth and rising cost pressures.

The lender proposed a final dividend of N8.75 per share, bringing total payout for the year to N10, up from N5 in 2024, according to its annual report released Tuesday.

The move comes as Nigeria’s top-tier banks navigate a volatile macroeconomic environment marked by currency swings, inflation and higher impairment charges. Nigerian banks had to March 31 to recapitalize.

Zenith Bank’s profit before tax fell 5% to N1.26 trillion, even as gross earnings rose 6% to N4.19 trillion, underscoring margin pressures and rising costs across the banking sector.

Still, profit after tax edged up to N1.04 trillion, supported by lower tax expenses, while earnings attributable to shareholders held broadly steady at about N1.04 trillion.

Dividend and Results

The sharp increase in dividend suggests Zenith is prioritising shareholder returns at a time when earnings growth is flattening, a strategy that could reinforce investor confidence but also raises questions about reinvestment amid tightening conditions.

Total dividend paid during the year rose to about N215.6 billion, compared with N141.3 billion a year earlier.

For investors, the payout reinforces Zenith’s long-standing reputation as a high-dividend bank, even as earnings per share dropped to N25.32 from N32.87.

The results show growing strain beneath headline numbers. Impairment charges on financial instruments climbed significantly, reflecting rising credit risks in a challenging economic environment.

At the same time, operating expenses and interest costs remain elevated, limiting the translation of revenue growth into stronger profits.

The bank’s balance sheet, however, remains robust, with total assets exceeding N31 trillion and shareholder equity rising to about N3.7 trillion.

Sustainability and Risk

Zenith also flagged climate and sustainability risks as part of its long-term outlook, noting exposure to both physical and transition risks while positioning sustainable finance as a growth opportunity.